Business News at 09:30 am on 7th November 2023

Let’s begin. Cello World’s successful listing on Monday is likely to rub off on the upcoming initial public offerings of consumer-centric companies, market experts said. The stock, which had received a 39x subscription, listed 28% higher at the exchanges. Cello World listed at Rs 831 on the BSE — a 28.24% premium to its issue price of Rs 648 — and closed at Rs 791.90, down 4.7% from its opening price but at a significant gain of 22.2% over its issue price. It already commands a market cap of above Rs 16,800 crore. According to data, there is a strong pipeline of consumer-centric IPOs to the tune of Rs 16,000 crore with regulatory approvals. Market players said the outlook remains strong due to good earnings visibility.
Meanwhile, Mobile subscribers will soon be allotted a unique customer ID by the government, which will act as their one-stop identification point for everything related to their primary as well as add-on phone connections. The move, being finalised by the department of telecommunications is to protect users from cyberfrauds as well as for providing government sponsored economic benefits to targeted customers. The concept is very similar to the 14-digit Ayushman Bharat Digital Health Account health ID linked to Aadhaar Card, which facilitates easy access to medical records, and also helps medical professionals like doctors and insurers to get medical information instantly.
Moving on. Running the Pradhan Mantri Garib Kalyan Anna Yojana in its current form for the next five years could necessitate a Budget outlay of Rs 11 trillion during the period in nominal terms, a government official said on Monday. Under PMKKAY, 813 million people are currently being provided 5 kg each of specified grains per month free of cost. The free ration scheme was to end on December 2023, but PM Modi said on Saturday at an election rally in Chhattisgarh the scheme would run for another five years. The cabinet committee on economic affairs is likely to approve the extension of PMGKAY soon. The additional budgetary cost of running the free ration scheme for January-March quarter could be around Rs 4,000 crore.
Over to banking. Many public sector banks have seen an improvement in their recovery from write-offs in the September quarter as lenders have adopted a wide range of measures to collect these loans. In addition to the government’s push to clean up bad debt in the banking system, pre-insolvency restructuring, a booming private credit market, and lower fresh slippages have helped improve recoveries, say experts. Many state-owned banks have seen a sequential improvement in recovery from write-offs in July-September, data from their investor presentations showed. The recoveries of these banks have also improved on an annual basis. Bank of Baroda Executive Director Ajay Kumar Khurana said that a few other accounts are lined up for recovery in the coming quarters, which should help the bank maintain its trajectory.
Now some updates on I-T refunds. Growth in personal income tax collections may slow a bit in the second half of the current financial year from the impressive 31% seen in the first, as the income tax department aims to make tax refunds to the tune of Rs 2 trillion in the remainder of the year, an official source told FE. The source added that the second-half refunds are likely to be higher than in the year-ago period by around Rs 50,000 crore. This would mean that the refunds in the whole of FY24 would be above Rs 3.5 trillion, as against a little over Rs 3 trillion last year.
Over to market. Despite volatile market conditions, the addition of dematerialisation, or demat accounts, showed a sharp spurt and rose to an 11-month high in October. The number of demat accounts in October stood at 132.25 million, which includes 98.54 million accounts on Central Depository Services and 33.80 million in National Securities Depository. This translates to a y-o-y growth of 27.98 million. The number of demat accounts rose by 30.56 million a year ago. Since March, the markets have been performing well. From March till now, midcaps are getting tremendous returns, said Neeraj Dewan, independent market expert. He added there might be some aberration this year as midcaps and smallcaps, have been getting really good returns.
Lastly, let’s know about the stocks you need to focus on. These include Adani Energy, Gland Pharma, Indian Energy Exchange, and HPCL among others. Adani Energy reported a substantial 46% increase in its consolidated net profit, reaching Rs 284 crore for the September quarter of 2023-24, primarily driven by increased revenues. The total revenue for the quarter surged to Rs 3,421 crore, up from Rs 3,032 crore in the same quarter the previous year. Indian generic injectables maker Gland Pharma, on the other hand, posted a weaker-than-expected second-quarter profit on Monday, as higher employee expenses eclipsed strong sales in key markets.